What Happens If I Don't Pay Property Taxes in Tennessee?

If you fall behind in property tax payments, you could lose your Tennessee home in a tax sale.

You might lose your home to a tax sale in Tennessee if you don’t pay your property taxes. Luckily, you’ll get notice about the sale before it happens along with the ability to pay off the delinquent amounts (plus interest, penalties, and costs) to prevent the sale. If your home is eventually sold to a new owner, you’ll also get some time afterwards to buy it back.

Tennessee’s Tax Sale Process

In Tennessee, when you fall behind in your property taxes, the unpaid amount becomes a lien on your home (Tenn. Code Ann. § 67-5-2101). Your home can then be foreclosed through the court system and sold at a public auction (a tax sale) to satisfy the tax lien (Tenn. Code Ann. § 67-5-2501). (Learn about your options to avoid a tax sale if you can’t keep up with the taxes.)

Notice of the Tax Sale

In Tennessee, a notice of the tax sale will be sent to you, typically by certified mail. The notice must also be advertised in a local newspaper or by printed handbills, whichever the court orders (Tenn. Code Ann. § 67-5-2502).

Your Right to Cure the Delinquency

You can stop the foreclosure by paying the delinquent amounts (including overdue taxes, interest, penalties, and costs). The court will then dismiss the foreclosure lawsuit (Tenn. Code Ann. § 67-5-2411).

Sale

If you don't cure the delinquency, your home will be sold at a public auction to the highest bidder. The minimum bid must be at least equal to the amount of:

  • the delinquent property taxes
  • interest
  • penalties, and
  • costs (Tenn. Code Ann. § 67-5-2501).

If no one bids on your home (or the bid is too low), the clerk of court will make a bid on behalf of the taxing entity. However, the clerk may decide not to bid at the tax sale if there are certain environmental risks present on the property (Tenn. Code Ann. § 67-5-2501).

You Can Buy Your House Back After the Sale

In Tennessee, you get a period of time after the tax sale to buy back or “redeem” your home. Tennessee law gives you a one-year redemption period after the court confirms the tax sale (Tenn. Code Ann. § 67-5-2701).

To get your home back by redeeming it, you’ll have to get caught up on the overdue taxes plus various additional amounts. (To learn more about how much it will cost and what procedure you must use to redeem your home after a tax sale in Tennessee, see Getting Your Home Back After a Property Tax Sale in Tennessee.)

Getting Your Home Back By Invalidating the Tax Sale

You may be able to file a lawsuit to invalidate the tax sale (under certain circumstances) to get your home back. For example, if you were actually current on your taxes when the foreclosure took place, you may be able to invalidate the sale. In Tennessee, you get up to three years after the sale to do this (Tenn. Code Ann. § 67-5-2504).

If you want to invalidate a Tennessee tax sale, you should speak with a Tennessee attorney who can help you determine the exact statute of limitations that applies in your particular situation.

How to Find Tennessee’s Tax Sale Laws

If you want to find Tennessee’s property tax statutes, look in Title 67, Chapter 5 of the Tennessee Code. To locate the Tennessee Code, go to www.lexisnexis.com/hottopics/tncode. (If you need assistance finding the statutes, see Nolo’s Legal Research FAQs & Basic Info area.)

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